The Senate has approved a measure extending the term of the Power Sector Assets and Liabilities Management (PSALM) Corp.

During a plenary session on Monday, the chamber passed on the third reading, the Senate Bill (SB) 2837 with 20 affirmative votes, zero negative votes, and zero abstentions. 

SB 2873 aimed to amend section 50 of Republic Act 9136, otherwise known as the Electric Power Industry Reform (EPIRA) Act of 2001.

The newly passed bill in the Senate allows PSALM to continue to exist for five years from the expiration of its original term on 26 June 2026.

Energy privatization strategy

It was tasked to formulate and implement the privatization plan for the government’s energy assets, previously held by the NPC.

The corporation also acquired all existing NPC generation assets, liabilities, Independent Power Producers (IPP) contracts, real estate and all other disposable assets. 

PSALM is also mandated to manage the orderly sale, disposition, and privatization of these assets to liquidate all NPC financial obligations and stranded contract costs.

In his privilege speech, Senator Mark Villar noted the PSALM substantially reduced its financial obligations by 76 percent or from PI.2 trillion to P294 billion as of December 2023. 

The corporation remitted around P26 billion to the Bureau of Treasury, which will be distributed as dividends to the national government.

“Psalm’s wealth of experience and knowledge gained throughout its 22 years of existence serves to operationalize the policies and provisions enshrined in the Epira,” Villar, sponsor of the measure, said. 

Villar stressed the Psalm is at the crucial point where the wheel has to continue spinning for the Corporation “to fully achieve its mandate contemplated under Epira.”

“Non-renewal of Psalm’s corporate life entails management of obligations that necessitate funding of the projected deficit of P275 billion. Should it be untimely abolished, the national government would have to absorb all of Psalm’s outstanding financial obligations,” he added.